It’s been a rough experience for the crypto market through 2022. As of November, the market had dipped by 70 percent from the previous high on November 20, 2021. Just when the market was going downhill after the FTX crash turned things even worse. The question is, can the crypto market recover in 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin has had many dips over the years. And every time, it’s bounced back with a big increase.
For example, in 2013, Bitcoin reached a peak of $1,160. It then plummeted for more than a year before reaching a bottom of $150. In 2017, it broke the record, and hit a new highest of $19,600. Then, in 2018, it was trading at $3,100. In 2020, the price broke that resistance and reached a new peak of $68,000 in the month of November 2021. Then, just like that we’ve seen another dip. However, the past has proven that following each dip there’s a bull-run.
Every Dip is Followed by a Long Bull Run
Similar to what we’ve witnessed in the past, dips are typically followed by a prolonged bull run that eventually surpasses the resistance created by the previous market’s highest price. This is evident in not just Bitcoin but also in other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain and cryptocurrency technology has progressed a lot in recent years. With more and better companies and industries embracing it, its usage and acceptance is growing. From banking to gaming cryptocurrency is being utilized in a myriad of ways. The growing popularity of crypto could result in increasing participation in the crypto market which could increase the price.
The rise in interest of institutions in cryptocurrency
In recent times, we’ve seen a growing curiosity from institutions investing in crypto. From hedge funds to banks, many large institutions are starting to explore the potential of crypto assets. The increasing interest from institutions could provide more stability to the market for crypto and could lead to more expensive prices.
Regulations from the Government
As the market for crypto grows, governments around the world are beginning to establish more favorable rules for crypto. This will help draw more investors and increase the acceptance of crypto in general.
More use cases for blockchain
The technology that is the basis of many cryptocurrency, blockchain, has a wide range of possible applications that go beyond financial transactions. For example, from supply chain management and voting, many companies are beginning to look at ways they can utilize blockchain technology, which could increase investment and enthusiasm in cryptocurrency.
Advancements in technology
Blockchain and cryptocurrency technology is at the very beginning of development. As advancements continue to be made in areas like security and scalability, potential of crypto assets will continue to increase. This could lead to more acceptance and higher prices.
Rising global economic uncertainty
In the current economic uncertainty brought on by the COVID-19 pandemic and other factors increasing numbers of investors are starting to look for safe haven assets such as cryptocurrency and gold. As the global economic situation remains uncertain and uncertain, this could lead to increased demand for crypto and more expensive prices.
Interest from retail investors
The institutional investors aren’t alone in ones showing interest in crypto. Retail investors, also known as individual investors, are also starting to invest in the market for crypto. With increasing numbers of people become aware of cryptocurrency and investing in it this could result in more demand and higher prices.
The growing awareness and acceptance of crypto
As the market for crypto continues to mature as more and more people are beginning to become aware about and appreciate it. As understanding and acceptance grows of crypto it could result in more people purchasing as well as holding the crypto that can increase prices.
reef price crypto
The Decentralized Finance (DeFi) is an area that is rapidly expanding in the crypto market that allows the provision of financial services created using blockchain technology. As DeFi expands and more projects and platforms become available, this could result in increased use and more expensive prices for crypto.
Advances in crypto-based payment methods
As the crypto market grows as more and more businesses are beginning to accept crypto as a form of payment. This could result in increased use of crypto in regular transactions and higher prices.
More investment from sovereign wealth funds
These funds are owned by the state as instruments for investing, are starting to explore cryptocurrency as a possible asset class. As more funds dedicate a part or their entire portfolios to cryptocurrency, this could lead to increased demand and more expensive prices.
Cryptocurrency is used for international payments
One of the major benefits of cryptocurrency is its capability to perform fast and cheap cross-border payments. As more and more people and businesses begin to use crypto for international transactions, this can lead to a rise in the demand for it and a rise in prices.
An increasing number of crypto ATM’s
With the amount of ATMs for crypto continue to increase it will be easier for people to buy and store cryptocurrency, which can drive up demand and prices.
Security tokens are developed for development
Security tokens, which are digital assets that represent ownership in an asset such as real estate or stock is a fast-growing area of the crypto market. As more security tokens are created and traded, it could lead to increased demand, and thus higher costs for cryptocurrency.
A greater adoption rate by merchants
With the increasing number of retailers accept crypto as a form of payment, it will make it easier for consumers to hold and use cryptocurrency, which will boost demand and increase prices.
So, is crypto likely to increase in 2023? It’s only time to find out. With these things being considered, it’s possible that the crypto market will have a rebound by 2023. For those looking to invest for the long-term patience and discipline is crucial.